A study investigated the effect of phonemic awareness instruction on the reading ability of first and second grade students. Participants were 100 second graders who had been in 5 first grades at Westside Elementary in Searcy, Arkansas. Using a posttest only control group design and a t test for independent samples, it was found that second grade students (n=42) who received a color-differentiated, rhythmic program of phonemic awareness and orthographic pattern instruction followed by a literature-based reading program in first grade scored significantly higher on the second grade SAT-9 reading test than students (n=58) who were instructed with a traditional basal reader program in first and second grades. Findings suggest that the phonemic awareness instruction was effective in improving the reading scores of the participating students. (Contains a table of data and 16 references.) (Author/NKA)